THE ENERGY SECTOR: UTILIZATION AS A MEANS OF ECONOMIC DEVELOPMENT
The Energy Sector: Utilization As A Means Of Economic Development
The depreciation in our economy is fast increasing alongside the need for energy and its services to satisfy human, social and economic developmental wants. Millions of people in Nigeria still live in extreme poverty, not forgetting the fact that it is a nation richly blessed with minerals and other kind of resources. This is due to the mismanagement and non-utilization of our resources and the energy sector as well. The Nigerian Energy sector is faced with the challenge of inadequate electricity supply to domestic households and even industrial producers, shortage of gas supply for thermal plants and a lot of issues. This article seeks to look into these challenges and also provide recommendations on how the energy sector can be utilized in developing our economy.
1.0 Introduction
Energy is an integral part of human existence and it satisfies various wants and is channeled towards productive activities. It moves our cars, boats and lights up our homes. It produces the heat used in baking, cooking at home, and powering most technological gadgets, ranging from phones, personal computers, inter alia, and produces motion and sound as well. The production and consumption of energy resources are important tools for the global economy. It is necessary for growth and development.
Energy sources can be classified into renewable and non-renewable (primary sources) and then the secondary sources which are derived from these primary sources.
2.0 Forms of Energy
We have two forms of energy. They are; Potential and Kinetic energy. The components of these forms will thus be discussed.
2.1 Potential Energy
This form of energy is composed of the following;
- Chemical energy- stored in atoms/molecules
- Mechanical energy- stored in objects by application of force
- Nuclear energy- stored in the nucleus of an atom
- Gravitational energy- is the energy of position or place
2.2 Kinetic Energy
Kinetic Energy is where the energy is stored in the motion of the mass, versus its location For instance, a golf ball up on the top of a hill has potential energy at rest, but as it rolls down the hill, gravity acting on that ball will continue to accelerate the ball, turning the potential energy into kinetic energy.
3.0 THE Nigerian Energy Sector
The Nigerian energy sector is composed of the various energy forms examined. However, there exists the over reliance on a particular form, crude. These sources are thus addressed, bearing in mind the contribution of each to the general energy maze.
3.1 Petroleum
Nigeria is richly blessed with a humongous amount of oil, gas, hydro and solar resource, and has the potential to generate 12,522 megawatts (mw) of electric power from existing plants. Nigeria has the largest economy in sub-Saharan Africa, however, limitations in the power sector constrains its growth. Nigeria’s Primary energy consumption was about 108 mtoe in 2011. The energy consumed is generated from waste and biomass, which is 83% of the total primary production, while the rest is from fossil fuels which is 16% and hydro power which is 1%.
Nigeria is a member of the Organization of the Petroleum Exporting Countries. The Nation boasts of oil reserves of about 35 billion barrels and gas reserves of about 5 trillion cubic meters which ranks 10 and 9th positions respectively. Complementing this, global production in 2009 reached 29 billion barrels of oil and 3 trillion cubic meters of natural gas.
3.2 Gas
Gas emanated from the Niger Delta and it is supplied to variety of industries in Lagos. A number of industrial users such as Guinness’s Ogba and Benin breweries utilize power plants. Nigeria’s gas abundance is a story notorious to every corner of the globe, albeit its underutilization.
3.3 Renewable Energy
Nigeria is blessed with renewable energy. However, hydro power and biomass are the only sources of renewable energy in the country which are heavily exploited. Wind and Solar energy have been deployed at a very minimal rate due to the fact that the renewable energy is just starting to take its toll on Nigeria.
In closing the gap created by underutilization, the Renewable Energy Master Plan (REMP) was developed by the Energy Commission of Nigeria in 2005, which brings up ideas for renewable energy policies and also possible technologies be used for the purposes as to why they were created.
4.0 Challenges in the Energy Sector
The challenges faced by the Nigerian energy sector include- shortage of gas supply for thermal plants, high rate of unpaid electricity bills and privatization of the power sector, which is really affecting the energy sector negatively.
The energy sector is faced with the challenge of improper utilization and mismanagement, even with the fact that the past and present governments have injected a lot of funds for its sustainment, but yet, no positive outcome from it.
The country Slovakia, with about 3% of Nigeria’s population has a higher electricity capacity than its Nigerian counterpart. Prior to this, successive governments have tried to provide solutions to this problem by monopolizing the power sector and funding this poorly managed sector. Under civilian rule, governments have spent about US$2bn annually on just electricity supply, but there are still no improvements to show for the massive investment of National wealth into this sector, the direct opposite of the desired result.
The government led by President Goodluck Jonathan, in 2010, set in motion the Power Sector Reform Roadmap which privatized the state -owned Power Holding Company of Nigeria (PHCN). This effort was a futile attempt at unshackling the epileptic energy crisis in Nigeria. The present level of our power supply and the overall production capacity is really insufficient. Presently, Nigeria can only supply electricity to half its population, generating a small amount of energy from renewable sources such as hydro power, solar, wind, and biomass.
Notwithstanding the revolutionary ownership change ushered in by privatization, the same problems still persist. This is really challenging and needs to be fixed before things get really worse. Notably, because of the heavy reliance or social and economic endeavors on power supply. This writer in the next sort, attempts to lighten up a dark Nation, Nigeria.
5.0 Recommendations/Conclusion
In order for the potentials of Nigeria’s energy sector to be utilized properly and to attain a developed economy, the government should look into the minimal deployment of hydro power, biomass, wind and solar energy, and provide mechanisms in which they can be deployed in larger amounts. This includes large investment opportunities being opened for local manufacturers and the promotion of local content. It is also recommended that Nigeria focuses on renewable sustainable energy, which is the practice of meeting the needs of the present without it affecting that of the generations yet to come, because recent research have proven that Nigeria can have a stable power supply from renewable energy and it is important, because it conserves our natural resources, promotes energy security and provides supply of power. Lastly, this article recommends that space solar stations be provided.
Nigeria must also harness its solar energy development potentials because recent research has shown that Nigeria could generate 600,000MW by deploying solar pv panels from 1% of Nigeria’s land mass. The government should launch solar projects that will help variegate its energy for our economic development. While this is capital intensive, it serves a greater good and has uncountable economic benefits for the citizenry and in turn, the government. Hence, government must not only deploy the available resources for this project, but entrust it to well-meaning Nigerian professionals to manage.
About the Author
Onyinye Igweonu is a 500 level student of the Faculty of Law, University of Lagos. She has avid interests in commercial law, intellectual property law, international law, arbitration and dispute resolution mechanisms. In her spare time, she enjoys reading and writing.
